It’s widely believed that the only people who can make money in real estate are traditional investors—people who have a lot of money to spare and/or a lot of experience to get an edge in the marketplace.
But with new developments and strategies emerging in the real estate industry in recent years, the old school of thought has gone out the window. In order to successfully make money on rental properties, you no longer have to fit into the traditional real estate “investor” box. Today, more and more beginners are playing their hand in the real estate investment game—and winning big.
Here are some tips to get you started in the real estate investment game:
Let go of the fear of not being an expert
So many people never get started in the rental business because they think they need to know everything about real estate and investing before they buy their first property.
But here’s the thing: anyone can be an investor, and a successful one to boot. You don’t have to be an expert and know it all before you start. You just need a plan, some persistence and the willingness to learn as you go.
Research different investment strategies and the different ways you might make money in real estate investment, like flipping houses or purchasing rental properties. Figure out which one makes the most sense for where you’re at (personally, professionally and financially), and put together a plan for how to make it work for you.
You want to educate yourself, but you also need to realize that it’s okay to not have all the answers. In fact, trying to absorb too much information about real estate investment can backfire and give you “analysis paralysis”—when you’re so overwhelmed with information that you go into information overload and are completely unable to make a move.
Obviously, you want to make informed decisions, but you can only learn so much in a book or on the internet. Eventually, you’re going to have to take action. Which brings us to our next point…
Find a mentor
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The quickest way to success in real estate investment is to find someone who’s done exactly what you want to do, and then have them show you how to do it. Working with a mentor will save you an immeasurable amount of time, frustration and money.
Attend networking events to connect with successful local investors. Let them know you’re new to the game and ask if they have any insights they wish they’d known when they were getting started. Follow up and ask if you can take them out for coffee to pick their brain. Most investors enjoy sharing their expertise and are open to mentoring newer players. The key is to be strategic with your questions—no one has time to walk you through their entire business model step by step, so really hone in on the areas you need help with and focus on those when asking for guidance.
Explore all of your options
There are so many ways to make money in real estate, and if you only explore or consider one option, you’re selling yourself short. When you’re getting started in real estate, make sure you explore all the options out there before deciding which one is right for you. That being said…
Unless you’re independently wealthy or the lucky recipient of a large trust fund, you’re probably going to want to start small while you figure out the real estate investment game. Quitting your day job and investing your life savings into a multi-unit apartment building is a risky bet for anyone, but especially for a beginner. Starting small takes the pressure off and allows you to get a working understanding of property investment before making the leap into larger—and potentially riskier—commitments.
Start pursuing small real estate investment projects, and as you learn more and start having small successes, start investing more. To truly find success in real estate investment, you’ll ideally want to grow your portfolio as you grow your knowledge.
The most important step in becoming successful in real estate investment is the first step: getting started. No matter who you are or where you are in life, it is possible to build a successful real estate investment portfolio. Follow these tips, and with a little patience, courage and tenacity, you’ll be well on your way to a successful investment career.Read more on Scaling